Mealey's Securities

  • February 21, 2020

    Securities Claims Against Aircraft Parts Maker Lack Materiality, Judge Rules

    CLEVELAND — A lead plaintiff in a securities class action lawsuit against a producer and supplier of highly engineered components for use on commercial and military aircrafts and certain of its senior executives has failed to sufficiently plead its federal securities law claims with the required materiality, a federal judge in Ohio ruled Feb. 19 in granting the defendants’ motion to dismiss (In re TransDigm Inc. Securities Litigation, No. 17-1677, N.D. Ohio, 2020 U.S. Dist. LEXIS 28087).

  • February 20, 2020

    Shareholder:  Fracking Company Violated Securities Laws By Omitting Material Facts

    NEW YORK — A shareholder on Feb. 19 sued a hydraulic fracturing company and its officers in New York federal court, contending that during a proposed acquisition they filed a proxy statement with the U.S. Securities and Exchange Commission that omitted material facts that were necessary to make the information not false or misleading (Xavier Washington v. Tallgrass Energy LP, et al., No. 20-1458, S.D. N.Y.).

  • February 19, 2020

    Price-Fixing Conspiracy Securities Fraud Claims Trimmed From Stock-Drop Suit

    PHILADELPHIA — A federal judge in Pennsylvania on Feb. 14 ruled that a lead plaintiff in a securities class action lawsuit against a generic drug company and certain of its current and former executive officers has failed to sufficiently plead its federal securities law claims pertaining to the defendants’ alleged involvement in an illegal price-fixing scheme with competitors (Alexandre Pelletier v. Endo International PLC, et al., No. 17-5114, E.D. Pa., 2020 U.S. Dist. LEXIS 26296).

  • February 14, 2020

    9th Circuit Panel Affirms Summary Judgment Ruling In Investment Fraud Suit

    SAN FRANCISCO — A Ninth Circuit U.S. Court of Appeals panel on Feb. 7 ruled that a federal district court did not abuse its discretion in denying reconsideration of its summary judgment ruling against a former executive vice president of a Switzerland-based company named with an acronym for “Make A Lot Of Money” in an investment fraud scheme because the defendant failed to show that any basis for relief from the ruling existed (U.S. Securities and Exchange Commission v. James Warras, No. 18-16684, 9th Cir., 2020 U.S. App. LEXIS 4113).

  • February 14, 2020

    Investment Fraud Suit Defendant’s Appeal Untimely, 9th Circuit Panel Rules

    SAN FRANCISCO — A Ninth Circuit U.S. Court of Appeals panel on Feb. 7 ruled that a defendant in an alleged investment fraud scheme lawsuit filed by the Securities and Exchange Commission failed to timely file a notice of appeal after a federal district court granted the SEC’s summary judgment motion and ordered the defendant and his co-defendant to pay disgorgement and a civil penalty for their roles in the scheme (U.S. Securities and Exchange Commission v. Anthony B. Brandel, No. 18-16685, 9th Cir., 2020 U.S. App. LEXIS 4118).

  • February 14, 2020

    Medical Marijuana Company Named In Stock-Drop Suit Over Alleged Misstatements

    BROOKLYN, N.Y. — A medical marijuana company and two of its senior executives issued several misrepresentations in reporting documents with Canadian securities regulators overstating the company’s financial and business condition in violation of federal securities laws, a shareholder says in a Feb. 12 complaint filed in New York federal court (Monica Acerra v. Trulieve Cannabis Corp., et al., 20-775, E.D. N.Y.).

  • February 13, 2020

    Panel Rejects Securities Fraudster’s Ineffective Assistance Of Counsel Claims

    PHILADELPHIA — A federal district court did not err in ruling that a convicted securities fraudster failed to sufficiently show that he received ineffective assistance of counsel before, during and after his conviction on 21 criminal counts in connection with his operation of an alleged securities fraud scheme, a Third Circuit U.S. Court of Appeals panel ruled Feb. 12 (United States of America v. Robert G. Bard, No. 18-cr-3754, 3rd Cir., 2020 U.S. App. LEXIS 4437).

  • February 13, 2020

    Appellees: Securities Claims Properly Dismissed For Lack Of Loss Causation

    ATLANTA — A federal district court correctly applied 11th Circuit U.S. Court of Appeals precedent in holding that a shareholder failed to plead any corrective disclosure in support of his loss causation analysis in a securities class action lawsuit against a beverage maker and certain of its senior executives, defendants argue in a Jan. 22 appellee brief filed in the 11th Circuit (Thomas W. Luczak v. National Beverage Corp., et al., No. 19-14081, 11th Cir.).

  • February 13, 2020

    Bribery Claims In Securities Suit Deemed Not Actionable; New Claim Time-Barred

    NEW YORK — Even though lead plaintiffs in a securities class action lawsuit against a multinational building materials company and others have added another defendant and cause of action against that defendant in their amended complaint, they have still pleaded only conclusory allegations in alleging that the defendants concealed the company’s involvement in a bribery scheme with a Columbian company in violation of federal securities laws, a federal judge in New York ruled Feb. 10 (Christopher Schiro v. Cemex S.A.B. de C.V., et al., No. 18-2352, S.D. N.Y., 2020 U.S. Dist. LEXIS 22828).

  • February 13, 2020

    Appellants: District Courts Have Jurisdiction To Hear SEC ALJ Ruling Appeals

    SAN FRANCISCO — A federal district court erred in ruling that it lacked jurisdiction to hear an appeal of a Securities and Exchange Commission administrative law judge’s (ALJ) ruling denying defendants’ motion to dismiss the administrative proceedings and their challenge of the ALJ’s removal protections, the defendants argue in a Jan. 29 appellant brief filed in the Ninth Circuit U.S. Court of Appeals (Raymond J. Lucia Companies Inc., et al. v. U.S. Securities and Exchange Commission, et al., No. 19-56101, 9th Cir.).

  • February 12, 2020

    Approval Of $65M Settlement In SeaWorld Blackfish Stock-Drop Suit Sought

    SAN DIEGO — Shareholders in a securities class action alleging that SeaWorld Entertainment Inc., its 100 percent shareholder and certain of its current and former senior executives asked a federal judge in California on Feb. 11 to grant preliminary approval of a $65 million settlement between the parties stemming from the defendants’ alleged concealment of the negative impact the documentary “Blackfish” had on the company’s business and financial condition (Lou Baker v. SeaWorld Entertainment Inc., et al., No. 14-2129, S.D. Calif.).

  • February 11, 2020

    Insufficiently Amended Claims Succumb To Dismissal Motion In Stock-Drop Suit

    FORT LAUDERDALE, Fla. — Dismissing a second amended complaint filed by a lead plaintiff in a securities class action lawsuit against a health care administration company and certain of its executive officers is warranted because the lead plaintiff failed to add any factual allegations that would cure the pleading deficiencies that led to the dismissal of its first amended complaint, a federal judge in Florida ruled Feb. 7 (Cambridge Retirement System v. MEDNAX Inc., et al., No. 18-61572, S.D. Fla.).

  • February 07, 2020

    Insufficient Scienter Allegations Lead To Dismissal Of Claims In Stock-Drop Suit

    TAMPA, Fla. — A federal judge in Florida on Feb. 6 ruled that lead plaintiffs in a securities class action against a company that specializes in foodservice equipment and certain of its current and former senior executives failed to plead the necessary element of scienter in arguing that the defendants failed to properly disclose weaknesses in the company’s internal controls pertaining to its financial reporting (The Metropolitan Transportation Authority Defined Benefit Pension Plan Master Trust, et al. v. Welbilt Inc, et al., No. 18-3007, M.D. Fla.).

  • February 06, 2020

    Securities Law Claims In Philip Morris E-Cigarette Class Action Dismissed

    NEW YORK — A federal judge in New York on Feb. 4 ruled that lead plaintiffs in a securities class action lawsuit alleging that tobacco company Philip Morris International Inc. and several of its senior executives misrepresented clinical study results for an e-cigarette product it manufactured, as well as the product’s financial performance in Japan, failed to plead any false or misleading statements made by the defendants or scienter in pleading their federal securities law claims (In re Philip Morris International Inc. Securities Litigation, No. 18-8049, S.D. N.Y.).

  • February 06, 2020

    Judge:  Defendants In Stock-Drop Suit Had Duty To Disclose Product Recalls

    SAN FRANCISCO — A federal judge in California on Feb. 4 ruled that investors have sufficiently shown that current and former top executives of a manufacturer of algae-based food, nutrition and specialty ingredients products violated federal securities law by failing to disclose to shareholders that two companies that used the manufacturer’s product were forced to recall certain products they produced after customers reported suffering from violent gastrointestinal issues (In re TerraVia Holdings Inc. Securities Litigation, No. 16-6633, N.D. Calif., 2020 U.S. Dist. LEXIS 19211).

  • February 05, 2020

    Investor Sues Mattel, Others Over Allegedly Understated Tax Expense

    LOS ANGELES — Toymaker Mattel Inc., certain of its current and former executive officers and its independent auditor understated the company’s income tax expense by $109 million in the third quarter of 2017 after misrepresenting Mattel’s financial condition and the effectiveness of its internal controls in violation of federal securities law, a shareholder alleges in a class action complaint filed Jan. 31 in California federal court (New Orleans Employees’ Retirement System v. Mattel Inc., et al., No. 20-1056, C.D. Calif.).

  • February 05, 2020

    Failure To Plead Falsity Leads To Dismissal Of Claims In Mattel Stock-Drop Suit

    LOS ANGELES — A federal judge in California on Jan. 21 granted a motion to dismiss in a securities class action lawsuit against toy maker Mattel Inc. and two of its senior executives, ruling that the lead plaintiffs failed to sufficiently plead falsity in arguing that the defendants misrepresented the company’s business and financial condition in violation of federal securities laws (Carol Wyatt, et al. v. Mattel Inc., et al., No. 19-1646, C.D. Calif., 2020 U.S. Dist. LEXIS 13012).

  • February 05, 2020

    Drug Maker Hit With Securities Suit Over Misstated Study Results

    SAN FRANCISCO — A shareholder sued a biopharmaceutical company and its CEO in California federal court on Jan. 23, alleging that the defendants concealed negative clinical trial results for the company’s bone marrow cancer treatment drug in violation of federal securities laws (Michael Tollen v. Geron Corp., et al., No. 20-547, N.D. Calif.).

  • February 04, 2020

    Investor:  Amended Complaint In Apple Stock-Drop Suit Not A Puzzle Pleading

    OAKLAND, Calif. — Dismissal of claims in a securities class action lawsuit against Apple Inc. and two of its senior executives is not warranted because a lead plaintiff’s amended complaint is not a puzzle pleading and because the lead plaintiff has sufficiently pleaded the elements of its federal securities law claims, the lead plaintiff argues in a Jan. 30 opposition brief filed in California federal court (In re Apple Inc. Securities Litigation, No. 19-2033, N.D. Calif.).

  • February 04, 2020

    Ponzi Scheme Conviction Sent Back To District Court Over Restitution Order

    NEW ORLEANS — A federal district court erred in issuing a restitution order in a criminal proceeding stemming from the operation of a Ponzi scheme because no indication exists in the record showing that the court considered whether to award restitution in the action “as a condition of supervised release,” a Fifth Circuit U.S. Court of Appeals panel ruled Jan. 15 (United States v. John Patrick Acord, No. 16-20820, 5th Cir., 2020 U.S. App. LEXIS 1343).